Summary: H.R.2929 — 105th Congress (1997-1998)All Information (Except Text)

There is one summary for H.R.2929. Bill summaries are authored by CRS.

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Introduced in House (11/08/1997)

Individual Social Security Retirement Accounts Act of 1997 - Amends the Internal Revenue Code to reduce social security taxes for eligible individuals, whether employed by others or self-employed, who elect to participate in the Individual Retirement Program (IRP) created under a new part B of title II (Old-Age, Survivors and Disability Insurance) (OASDI) of the Social Security Act (SSA) (part B eligible individual). Reduces the employers' tax for employers of such individuals. Leaves the respective tax rates at their current levels with respect to individuals who remain covered under the current OASDI program (redesignated as part A of SSA title II).

(Sec. 3) Amends SSA title II to require, under new part B, that employers have in effect a social security payroll deduction plan for eligible employees who elect to enroll under it. Requires the plan to provide for employers to deduct five percent of the employee's wages, together with an employer contribution also equal to five percent of the employee's wages, for transfer to the employee's individual social security retirement (ISSR) account.

Requires self-employed individuals to contribute ten percent of their income to such accounts.

Makes employees between ages 18 and 61 who are not entitled to OASDI disability benefits eligible to elect to enroll under new part B. Entitles eligible individuals who attain age 62 to a supplemental minimum benefit payment to their ISSR accounts. Requires a trustee of an ISSR account to purchase, from amounts available in the account, disability insurance and preretirement survivor benefits for each account holder.

Sets forth penalties for failure to establish and maintain a social security payroll deduction plan.

Amends the Internal Revenue Code to require amounts deducted from employee wages to be shown on their wage receipts.

Amends the Employee Retirement Income Security Act of 1974 (ERISA) to exempt social security payroll deduction plans from certain requirements for employee benefit plans.

(Sec. 4) Amends the Internal Revenue Code to exclude from an individual's gross income: (1) any amount paid to an ISSR account as the employer's contribution; or (2) half of the amount paid to such an account of a self-employed individual. Exempts such accounts from taxation (except the excise tax on certain prohibited transactions). Provides for taxation of account distributions to the extent they are includible in gross income like social security benefits. Imposes an excise tax on excess contributions to an account.

(Sec. 5) Amends SSA title II to declares that eligible individuals who have elected to establish ISSR accounts shall be deemed not entitled to OASDI benefits.

(Sec. 6) Directs the Commissioner of Social Security to certify to the Secretary of the Treasury whether an eligible individual was credited with wages and self-employment income under SSA title II part A immediately before the first calendar year for which the individual may distribute amounts from an ISSR account. Provides that, immediately upon receipt of such certification, the Secretary shall issue a contribution recognition bond to the trustee of the ISSR account held by such individual. Defines a contribution recognition bond as consisting of an obligation of the United States to make monthly payments into an ISSR account in an amount equal to the individual's primary insurance amount.

(Sec. 7) Provides for a phased-in increase in the social security retirement age, eventually to age 70 with respect to an individual who attains early retirement age after December 31, 2028.

(Sec. 8) Amends SSA title II to provide for the application of adjusted percentages to average indexed monthly earnings in determining primary insurance amounts.

(Sec. 9) Amends the Congressional Budget Act of 1974 to provide for off-budget treatment for specified social security reforms.

(Sec. 10) Directs the Office of Personnel Management to study and report to the President and the Congress on the most appropriate and feasible means of providing for the application of this Act with respect to Federal civilian and military personnel.